N145 per litre fuel: Going, going, going…

In every country the trending price regime for petroleum products is often more significant than often realized.  This is so as in the contemporary world, petroleum and the complement of products derived from it remain the engine that drive life and living. This is also why the politics surrounding petroleum and its various products often […]

In every country the trending price regime for petroleum products is often more significant than often realized.  This is so as in the contemporary world, petroleum and the complement of products derived from it remain the engine that drive life and living. This is also why the politics surrounding petroleum and its various products often features not only local imperatives but could involve global concerns that introduce twists and turns which lead power brokers to adopt measures that could lead to stupendous wealth or embarrassingly ignominious outcomes. The moral here is that you do not mess around with petroleum market imperatives whether at the home front or on the global stage, for to do so is to execute the twist dance style on a slippery floor. 

At the height of a vicious fuel crisis that has paralysed the country for over 13 weeks, Nigeria is hosting the Nigeria International Petroleum Summit (NIPS) between Monday to Friday, February 19th – 23rd 2018. This is inspired by the country’s dominant stature in the African oil and gas sector as a leader in both endowment of petroleum resources as well as in production of same.  From all indications the government seems to be more concerned with playing to the gallery through eye service to the world than solving the lingering fuel crisis. In order to deny the visiting foreign participants a true view of the messy state of affairs in the country’ petroleum sector, the government is adopting measures to clear fuel queues from the streets just for the event. Accordingly, the Minister of State for Petroleum, Ibe Kachikwu, has directed the Group Managing Director (GMD)of the Nigerian National Petroleum Corporation, DR Makanti Baru, to ensure that no fuel queue remains on Nigeria’s main streets throughout the duration of the fair. Speaking at a press conference preparatory to the oil and gas fair, Kachikwu stated that “I will hate for my colleagues to come and see the fuel queues so my directive to NNPC would be to get these queues out of Abuja”. 

And as is predictable the only option open to the government to achieve this ‘feat’ is to flood the market even if temporarily with petroleum products by all means fair and foul as some may say. What happens after the visitors and fair participants leave is a matter for another day. For as it is, the need to avoid any embarrassment to the government as it puts up a false image of its performance, seems more important than the agonies of Nigerians across the country, as they waste their days and nights locked in sprawling and stagnant fuel queues, in the cold and dusty harmattan season, with its attendant consequences. 

But should the government need to bother itself by adopting such a lame measure which is not better than the oddity of an ostrich hiding its head in the sand when faced with a danger? What is it about Nigeria’s or any other country’s internal affairs especially government’s failures that is hidden from the outside world? Except of course there is something the government wants to hide from Nigerians.

For the past three months – that is just before the Yuletide season and up till this moment the country has been in the unrelenting grip of this debilitating crisis in the fuel price regime, which has been trailed by responses from sundry government officials; none of which has been able to abate the problem. Questions from sundry stakeholders have also been raging over why the dispensation, just as varied answers have been proffered with each falling short of providing a way out. Yet in the face of the seeming intractability of the situation lies the issue of a questionable attitude of the government to the crisis. Many are wondering if the Buhari administration really wants to solve this problem in a sustainable manner beyond hoodwinking the public in order to serve some political interest. 

While it may sound irreverent to see the government’s disposition to the fuel crisis as a progression in self-delusion, by insisting on retaining the current fuel price regime, especially the official price of N145 per litre for Premium Motor Spirit (PMS or petrol in common parlance) it has rather attained little else. The truth of the matter is that the days of buying petrol at N145 per litre are gone and over. Beyond whatever logic that justifies government’s stance over the country’s petroleum industry, as long as only government can operate with ease it will remain doomed. While there may arise conjecture over why that is so, such cannot be so for the price regime as only a free market situation tames supply restrictions as is the case in the Nigerian market which Kachikwu intends to hide from the outside world. 

Incidentally some pundits have raised the spectre of a rescue for the country coming from the forthcoming the 750,000 barrels a day capacity mega refinery being developed by Dangote Group in Lagos. While such contemplations may assuage the credulous at heart they do not have any place in the cold logic of profit driven business terrain. Even if Dangote were to stretch his legendary altruism and philanthropy to superlative dimensions, he could not have invested a whopping $11 billion in a single refinery only to dispose it to charity. The world of business will expel him if he did that! Yes it will make the product available but will not make it cheaper.

Suggestions and recommendations in respect of a home grown solution to the country’s fuel debacle is contained in a report by a Committee set up by the President Muhammadu Buhari, which has since been submitted to him for subsequent action. Until he acts on it so long shall the country remain prostrate in the face of an avoidable fuel shortage. Even then the return to purchase of fuel nationwide at N145 per litre may remain a dream.